Following a sudden tide of rumors, Locals Care confirmed to SFR on Nov. 23 that it had ceased operations. Two days later, it issued a formal public notice that declared Locals Care had terminated its efforts earlier in the month.
Locals Care has operated as part of the broader buy local movement in Santa Fe for the past few years. It offered a free card to shoppers that allowed them to both earn rewards toward future purchases and make contributions to local nonprofits, when used at participating merchants. In its public announcement, Locals Care says, “It’s been a tough economy. The more we looked at the numbers, the more it became clear that Locals Care was one more struggling small business.”
As disturbed as I am by the closing of a business dedicated to creating consumer loyalty for local, independent operations, the Locals Care statement continues a frustrating pattern of poor communication that the effort has had since its beginning. It’s a factor that likely contributed to the business’ demise.
“It’s been a tough economy” is a bland observation used in this situation as a stand-in for “it’s not our fault.”
“The more we looked at the numbers” is code for “we’re not going to show you the numbers.”
I’m not going to go so far as to suggest the statement “Locals Care was one more struggling small business” is a passive-aggressive swipe at the local business community, but having exchanged many emails and conducted many meetings with Locals Care representatives over the past few years, I can confidently say communication with bizarre potential implications played a larger role in its demise than being “one more struggling small business.” After all, most of Santa Fe’s struggling small businesses are, in fact, struggling toward survival. Most of them, unlike Locals Care, didn’t get a $100,000 investment from Flywheel Ventures last year.
The notice goes on to say Locals Care was a great fit for the community and that its business model was “ideal.” Presumably, we’re meant to interpret “ideal” as “disconnected from reality” in this situation, because it apparently wasn’t ideally suited to success.
This is the point at which, ordinarily, I’d stop ribbing on the sad demise of a good effort with its heart in the right place and start lamenting the sad state of a community that doesn’t allow such a thing to succeed. And, Locals Care hombres William Underwood and Colt Brown have always been genuine in their intentions. But then there are those pesky actions with which to contend.
In this case, there’s the discreet aside in the Locals Care notice of discontinued operation that reads, “Please be advised that Locals Care, Inc. will be unable to honor cardholder rewards or nonprofit distributions.” Awww, just in time for Christmas. No wonder we don’t get to see “the numbers.”
Also, the Locals Care website now forwards to something called SparkBase. SparkBase is a Cleveland, Ohio-based gift card and merchant loyalty program processing center. When I asked SparkBase President Geoffry Hardman what was going on and what his company’s intentions for the Santa Fe market might be, he said he didn’t know if he was allowed to talk about it yet and invited me to send an inquiry in writing (I did immediately, and later received a “no comment”). Of course, there may be nothing sinister afoot here, but there’s a kind of pathetic irony in Santa Fe’s Locals Care URL becoming the property of Cleveland.
Finally, there is the touchy dark side of attempting to do business as a social entrepreneur. If you screw up, you’re anything but “one more struggling small business.” Instead, you’re the death of the promises you made and the hope you inspired. If you claim you’re going to make both money and social change, then you’ve got to accept responsibility for both.
Part of that responsibility might have been having a program with clear, understandable parameters. Instead, consumers, merchants and nonprofits all drifted through a kind of haze, each unclear as to how exactly to utilize and promote the Locals Care program. And what did Locals Care do to address the problem? It tried to expand to Albuquerque and began shopping for expansion opportunities in other states. It sank cash into software rather than customer service.
I don’t know if it’s fair to blame the death of a good idea in Santa Fe on its organizers’ fevered grasps at survival and profitability, but a community that has been let down is entitled to a little rage. After all, each attempt at social entrepreneurialism that fails makes it that much more difficult for the next one to gain acceptance by the community.
That rage, however, can be muted with information. Another part of the responsibility of pitching social change for profit should be in disclosing failure so that it’s not repeated the next time around. Tell us exactly what happened, Locals Care. Tell us where the money went, tell us what worked and what didn’t work.
If you can do that, then shutting down remains part of the solution.
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